Suzuki to launch bikes in premium segment

Satya Sheel has been at the helm of affairs as the managing director of the SMI and has grand plans for the company. Though the bike maker understands the massive market power of two-wheeler biggies Hero Honda, Bajaj Auto and TVS Motors, a complete product portfolio and a wider dealer network spread across the country will make the Suzuki a known brand in bikes and scooter segments. First it will be the 500 cc to the 1300 cc legendary Hayabusa that will grab immediate attention of the market and the foray into the 150cc premium bike segment will give the much needed accomplished manufacturer tag. Talking to Auto Mania, Mr Satya Sheel chalks our the company’s plan and the broader strategy that establish Suzuki in the two-wheeler space.

What are the expansion plans of SMI for the Indian market?

We plan to invest additional Rs 150 crore at our Gurgaon facility that will increase its capacity to 1.25 lakh units from the current 80,000 units. It will take the cumulative investment of Suzuki to around Rs 500 for the two-wheeler facility, and indicates our seriousness for this market.

The company has launched a new scooter Access. What impact will it make?

Access in the only scooter in the 125 cc segment in India. It is stylish and trendy and yet sober for the entire family. It is packed with the Xtra Torque Performance (XTP) engine to carry a small Indian family easily and has the added safety feature of single point central locking. It will deliver a excellent mileage of 65 km/ litre of petrol and we aim to sell around 5000 units per month.

Does the new launch mean that SMI is aiming to become a volume player in the two-wheeler market?

We are a fringe player yet and don’t have a broad product line like Hero Honda and Bajaj Auto. But the difference will be noticed in the next few years and we will be launching many Indian specific products including 150 cc bikes to harness the potential of the market. Meanwhile out plant capacity if required could be rammed up to a million units as the market expands.

What kind of market share if SMI aim at?

The company plans to grab a 4% market share (around 3.5 lakh units) by 2010 from the about 1% (63,534) share it currently has. SMI had invested Rs 350 crore at its Indian facility and produces two bikes Heat and Zeus in the 125 cc segment, which are giving reasonable numbers. The launch of Access 125 marks our foray into the scooter segment and will add sufficient numbers in next few months.

How many launches does the company plans to make in India?

We will be launch three new models in the next two years. Like the Access scooter which will cater to the needs of an urban Indian family in small, medium and large cities in the country, other product will also be the hallmark of Suzuki’s technology.

So what are the long-term plans for the Indian market? Any plans to align with the passenger car market leader Maruti-Suzuki, in the domestic market for the marketing needs?

We plan to double our dealer network to 300 from the current 145. Once the network is in place, our product will cater to the larger market and the existing Maruti-Suzuki network will complement our products but there won’t be any exact synergy. It could lead to complications in the market. So a separate identity will be maintained and both will have enough space to exist separately.

When are the super bikes, like the legendary Hayabusa expected to hit the market?

Satya Sheel - These are very expensive bikes. We will be introducing them and they will be representational models as the excessively high custom duty make highly very expansive for the Indian market. Ideally the duty should be about half of what it is at present, so the products have some real market in India. We have to be present in all the segment so various products will be lined up for that in future. We are planning to launch 150 cc bikes in the performance segment next year.

What is the future of the two-wheeler market in India with the current slowing demand and declining market impacting margins?

There is a large potential in India, but that should be complemented with easy financing options. With a majority over 60% sales coming from finance, the massive increase in the interest rates has impacted the market conditions. With the two-wheeler penetration in India one of the lowest in Asia and as the economy is buoyant and infrastructure is improving, it will lead to better mobility, which will surely add numbers to the two wheeler market.